What is the maturity period of instruments traded in the 'Call Money Market'?
- 1 day
- 2 to 14 days
- 15 to 90 days
- 1 year
Answer: 1 day
The call money market deals in extremely short-term, uncollateralized loans between banks to meet their immediate reserve requirements. Funds borrowed for exactly one day are called 'call money', whereas funds borrowed for 2 to 14 days are termed 'notice money'.